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Food For Thought: Near-Term Phosphate Production in Agro-Heavy Brazil

VANCOUVER, BC / May 16, 2014 / Last year was another big growth year for Brazil's agriculture sector yet going into 2014 the sector still faces an acute shortage of domestically produced fertilizer to keep up with increased demand. As the second largest importer of phosphate globally, this grim reality is unlikely to change anytime soon.

For Canada's DuSolo Fertilizers Inc. [DSF.V, ELGSF.PK-formerly Eagle Star Minerals Corp.], the timing couldn't be more perfect. Over the past three years DuSolo has managed to assemble a portfolio of superior phosphate assets by collectively pooling knowledge from a team of Brazilian phosphate experts. Included amongst these assets is the company's flagship project Bomfim where most recently DuSolo finished an aggressive drill program which resulted in a very strong Initial Resource Estimate that includes a sizeable amount of high-grade phosphate at or very close to surface. With this resource in hand and a $3.0 million financing recently completed, DuSolo is well positioned to deliver on their near term cash flow strategy in 2014.

BOMFIM–MULTIPLE TARGETS OF HIGH-GRADE AND LARGE TONNAGE PHOSPHATE

The Bomfim Project resides along the "phosphate belt" of Brazil where many major companies are now exploring for the commodity including Vale, Votorantim and the now producing Single Super Phosphate Mine of MbAC Fertilizers ("MbAC").

DuSolo has identified 10 targets at Bomfim to host phosphate mineralization in large tonnage. Drilling to date has just explored small portions on 3 out of the 10 targets on 4 out of 12 claims owned by the company. Considering the significant Initial Resource Estimate was achieved with relatively little drilling, the potential upside in terms of resource expansion seems high.

DuSolo's Target H "Santiago" is at the top of the Company's priority targets list. Santiago is DuSolo's most recent addition to Bomfim and borders MbAC's largest and higest grade ore body "Canabrava". Early detailed mapping performed by DuSolo at this target had indicated a strong possibility for the extension of the Canabrava mineralization into Santiago and a follow-up drill program near the properties boundary confirmed it. Large intercepts of similar and higher-grade phosphate were encountered as part of DuSolo's initial drill program and prompted the technical team to further evaluate this target with additional drilling.

In preparation for this follow-up drill program, DuSolo needed to clear vegetation on the Santiago Target up to 1.5 kilometers from the MbAC claim boundaries. Upon removing the vegetation, DuSolo uncovered something very rare in Brazil, -a large outcrop of high-grade phosphorite that covers a minimum area of 600 by 300 meters.

"This was a huge turning point for us," says Eran Friedlander, President and CEO of DuSolo Fertilizers Inc. "It's one of the major reasons we were able to court our new VP of Exploration Professor Paulo Amorim to join our team. When he visited the property, he said that in his entire career of working with phosphates in Brazil, he has never seen a high-grade outcrop that big."

So with the land cleared and the outcrop exposed, DuSolo didn't hesitate to commence further drilling aimed towards calculating a resource. The Company drilled a total of 23 holes in 2013 on Santiago alone and over 200 between the other two targets. These areas drilled to date amount to:

-Initial inferred resource estimate of 18.2Mt @ 6.32% P2O5

-Initial measured & indicated resource of .462Mt @ 11.88% P2O5

-Including 4.1Mt inferred @ 14.47% P2O5

-Including .316Mt measured and indicated @ 15% P2O5

The technical team at DuSolo believes that based on field evidence the Initial Resource Estimate covers only 15% of the potential in Bomfim. To put these numbers into perspective, MbAC paid approximately 35 million dollars for their Itafos asset a few years back with a resource of 18 million tonnes @ 4% P2O5. That payment alone is much higher than DuSolo's current valuation of 20 million and that resource is smaller. Former Canadian listed company Rio Verde Minerals Development Corp [RVD.V] was acquired last year at a valuation of 60 million dollars for a resource of approximately 1.8 million tonnes @ 18% P2O5 less than half of what DuSolo has initially proven as far as high-grade mineralization is concerned at this early stage with many other targets to still be drilled.

STAGES 1 & 2 OF PRODUCTION

With very good grades and an obvious new flagship on their hands, DuSolo is well on its way to settling down on a site on which to start production of Direct Application Natural Fertilizer ("DANF") from the high-grade phosphate discovered at Bomfim.

"The plan moving forward is to establish cash flow as quickly and efficiently as possible through the DANF market," says Friedlander. "This would represent Stage 1 of our production plans, while we work to establish what premium fertilizer product we will sell at Stage 2."

MbAC and their predecessors Itafos were producing DANF in this region for the past 5 years, which the local market has become accustom to applying to their soils. However this supply was recently and suddenly cut off, due to MbAC ceasing production to solely focus on their SSP operations, hence creating an incredible opportunity for DuSolo.

DANF provides farmers with a lower cost alternative to keep their phosphate levels in the soil elevated as opposed to continually applying the standard more costly NPK blend.

"The market for DANF exists locally and the potential for expansion is large, but the product is not currently available to consumers," says Friedlander. "A void in the DANF market has been created hence why we made the decision to get involved here. It is a quick route to establish cash flow with much of the risk alleviated. DANF production is perfect for a company like DuSolo because of the low capex (less than 500,000 to start-up operation), and the opportunity to leverage on an existing market right away at minimal marketing costs. Overtime we believe we can build this market out even further to what MbAC had created and in parallel continue to expand our resource in the most non dilutive way possible." EXPERIENCED MANAGEMENT TEAM

In 2013, DuSolo announced multiple major additions to its phosphate team with specific experience in the Brazilian phosphate sector.

Edvaldo Guimaraes is the former Sales and Marketing Manager for MbAC and was responsible for heading up the DANF sales unit for the past three years. Mr. Guimaraes brings a plethora of solid relationships with the area's consumers. An agronomist by trade, Guimaraes has already worked with many of the region's farms and has built up a level of trust that is of extreme value to DuSolo.

Another key addition came in the form of a Mining Engineer. Mr. Tiago Pereira was the former Production/Development Engineer for MbAC's DANF plant and was instrumental in taking the plant online. He was also involved in the acquisition and construction of the facility. Mr. Pereira has therefore the capacity to recreate the same operation for DuSolo.

The latest addition to the team is Professor Paolo Amorim, who brings 38 years of experience in the mining sector, 22 years of which he spent with Vale. Most recently, Professor Amorim concluded his responsibilities of heading exploration programs for both MbAC and Rio Verde (later acquired by B&A Mineração S.A.).

THE BOTTOM LINE

DuSolo has been quietly building a very solid position in the Brazilian agro-mineral space for a few years now. Recently they accelerated their corporate development by scooping talent and valuable real estate that have enabled the Company to deliver a strong Initial Resource Estimate.

DuSolo's technical team with its credibility now proven promise to deliver further success by significantly expanding resource potential and developing production capacity.

G.JoelChuryfor the Bottom Line Report

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